BIGGER BETTER? Big semiconductor outsourced assembly and test firms have the technological and financial advantages over smaller firms to ride out the storm

Taipei Times
Date: Sep 14, 2019
By: Crystal Hsu  /  Staff reporter

With demand for smartphones and personal computers declining, large outsourced semiconductor assembly and test (OSAT) companies should fare better than their smaller rivals because of their better technological capabilities, more diversified product portfolios and financial flexibility on research and development, Fitch Ratings said.

The industry could see a short-term recovery in revenue after a severe downturn in the first half of this year, thanks to the arrival of new-generation smartphones and better demand for wearables and automotives, the international ratings agency said.

Larger firms, such as Taiwan’s ASE Technology Holding Co (ASE, 日月光投資控股) and US-based Amkor Technologies, should see faster growth and gain market share at the expense of Chinese rivals Jiangsu Changjiang Electronic Technology (江蘇長電科技) and Singapore’s Global A&T Electronics Ltd, it said.

Larger chip assembly and test companies have conservative leverage and have been diversifying to offer new products, such as wearables, automotive and Internet of Things, where demand is growing rapidly, it said.    [FULL  STORY]